The findings of a recent automotive study by a reputation experience management (RXM) company points to the importance of reviews for nearly 80% of consumers—with 41% saying they will read at least five reviews before visiting a dealership.
In its annual automotive industry report released on October 11, Reputation also found that inventory shortages are top-of-mind for customers, with online reviews mentioning shortages increasing 32.6 times from January 2021 to July 2021.
“The automotive industry has seen it all over the past year, from huge spikes in sales to inventory challenges,” said Joe Fuca, CEO of Reputation. “Through it all, dealers and manufacturers have embraced digital tools and customer feedback to create a smooth car buying experience for all.”
The company said reviews and star ratings drive customer leads—with 64% of consumer respondents saying they would travel more than 20 miles (about 32 kilometres) to a top-rated dealership.
As for what is helping dealership ratings, Reputation said customer service is the main driver of positive ratings. And that despite the increase in digital activity, purchasing a vehicle remains a largely “human-centred, face-to-face experience”—with 65% of consumers indicating that they are influenced “significantly” by in-person visits. That said, online remains the preferred choice during COVID.
The report also found a significant increase in electric vehicle (EV) reviews since 2020, and notes that the uptick can be tied to an increase in EV sales and heightened public interest.
What is not helping dealerships is the sticker price challenge. If customer service is the main driver for positive ratings, price is the opposite—the main driver for negative dealership ratings.
“Dealerships need to manage consumers’ expectations about prices during the inventory shortage when demand is outstripping supply,” said the company in a news release. “Eighty-two per cent of consumers we surveyed with YouGov said price is an important consideration, more than any other factor.”
Reviews mentioning shortages are also around twice as likely to be negative compared to reviews about the industry in general, which can impact a dealership’s online standing.
“So, it’s not that customers are necessarily upset about a chip shortage but how dealerships are communicating with them about the ramifications of the shortage,” Reputation writes in its report. “That includes the impact on the vehicle’s price and elimination of rebates or other incentives.”